U.S. Stocks Remain Sharply Higher After Early Rally

(RTTNews) - Stocks showed a strong move to the upside early in the session on Tuesday and continue to turn in a strong performance in afternoon trading. After ending Monday's trading modestly lower, the major averages have all moved sharply higher on the day.

The major averages have moved roughly sideways in recent trading, hovering near their best levels of the day. The Dow is up 410.86 points or 1.2 percent at 34,822.55, the Nasdaq is up 245.01 points or 1.8 percent at 13,577.36 and the S&P 500 is up 57.03 points or 1.3 percent at 4,448.72.

The strength on Wall Street may partly reflect bargain hunting after the modest drop seen on Monday dragged the Nasdaq and the S&P 500 down to their lowest closing levels in a month.

Traders have also reacted positively to some of the latest earnings news, with Hasbro (HAS) posting a strong gain after the toy maker reported first quarter earnings that missed analyst estimates but raised its full-year profit forecast.

Shares of Johnson & Johnson (JNJ) have also shown a strong move to the upside after the healthcare giant reported better than expected first quarter earnings. Traders seem to have shrugged off J&J's lower full-year guidance.

On the other hand, insurance giant Travelers (TRV) has moved sharply lower despite reporting earnings that beat analyst estimates.

IBM Corp. (IBM) and Netflix (NFLX) are among the companies reporting their results after the close of today's trading, while Procter & Gamble (PG), Tesla (TSLA), AT&T (T), American Express (AXP), and Verizon (VZ) are also due to repot their results this week.

In U.S. economic news, the Commerce Department released a report showing new residential construction expectedly saw modest growth in the month of March.

The report showed housing starts rose by 0.3 percent to an annual rate of 1.793 million in March after spiking by 6.5 percent to a revised rate of 1.788 million in February.

The uptick surprised economists, who had expected housing starts to fall by 1.4 percent to a rate of 1.745 million from the 1.769 million originally reported for the previous month.

The Commerce Department said building permits also climbed by 0.4 percent to an annual rate of 1.873 million in March after slumping by 1.6 to a revised rate of 1.865 million in February.

Building permits, an indicator of future housing demand, had been expected tumble by 1.8 percent to a rate of 1.825 million from the 1.859 million originally reported for the previous month.

Sector News

Airline stocks have moved sharply higher over the course of the session, with the NYSE Arca Airline Index soaring by 3.3 percent.

The rally by airline stocks comes after a federal judge in Florida struck down the Biden administration's mask mandate for airplanes and other public transportation.

The upbeat housing starts data has also contributed to considerable strength among housing stocks, as reflected by the 3.3 percent jump by the Philadelphia Housing Sector Index.

Retail stocks have also shown a significant move to the upside on the day, driving the Dow Jones U.S. Retail Index up by 2.4 percent.

Financial, tobacco and semiconductor stocks have also moved notably higher, while gold stocks are bucking the uptrend amid a pullback by the price of the precious metal.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index advanced by 0.7 percent, while Hong Kong's Hang Seng Index plunged by 2.3 percent.

Meanwhile, European stocks climbed off their worst levels of the day but still closed mostly lower. While the French CAC 40 Index slid by 0.8 percent, the U.K.'s FTSE 100 Index and the German DAX Index

In the bond market, treasuries are extending the downward trend seen in recent sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.3 basis points at 2.905 percent.